Kiplinger: Frugal Habits of the Super Rich

T. Boone Pickens

Age: 84

Estimated net worth: $1.4 billion

How he struck it rich: Oil!

Frugal habit: Buys new business clothes once every five years

Pickens has 55 years’ worth of professional achievements, including growing his first company, Mesa Petroleum, into a $2 billion business and an infamous 1985 "Time" magazine Cover. But these days, Pickens is almost as well known for his low-budget lifestyle as he is for his high-profile financial success. "People are always surprised that I don't have a closet full of suits," Pickens told Kiplinger. "I buy three suits every five or so years and only own ten total. That's all I need."

Pickens credits his grandmother with having taught him money lessons that still resonate: "She'd always tell me, 'Don't ever go any place with money in your pocket looking for something to buy.'" Even today, Pickens says that whenever he visits a store he first makes a list of what he needs, and he carries only the exact amount of money he plans to spend.

More from this Slideshow

Becoming wealthy and staying that way takes a certain level of discipline. Sure, an occasional splurge won't put you in the poor house, but frequent frivolous spending on things that aren't necessities can quickly put a serious dent in your wallet. The frugal habits necessary to achieve financial success and maintain it are often lessons learned early on.

In this slide show, meet seven entrepreneurs, business leaders and famous faces, including Google's David Cheriton, Berkshire Hathaway's Warren Buffett and Hollywood's Hilary Swank, whose modest living -- from clipping coupons to clipping their own hair -- has helped them amass and/or maintain vast fortunes.

As Knight Kiplinger wrote in his classic column The Invisible Rich, "the biggest barrier to becoming rich is living like you're rich before you are."

Learn more about the cost-cutting moves that help make these successful millionaires and billionaires who they are.

Frugal habit: When having dinner at a nice restaurant, he saves half of his meal for the next day.

In addition to knowing how to make a good meal last, the Stanford University professor -- who played an integral role in the founding of Google -- has also been cutting his own hair for the past 15 years and drives a 1986 Volkswagen Vanagon.

Cheriton's been pinching pennies his whole life. "Many of my frugal habits come from my parents, who grew up during the Depression and passed along the same careful habits," he told Kiplinger. "My rule is never spend in a way that I can't explain to my parents without apology or embarrassment. It's kind of a personal version of 'never do anything you don't want to see presented on "60 Minutes."

Swank comes from humble beginnings, having grown up in a trailer park in Bellingham, Wash. In 1990, at age 16, she moved with her mother to Los Angeles to pursue her acting career. During that time, they lived out of a car to help make ends meet. Her Oscar-winning performance in the 1999 film "Boys Don't Cry" is what took Swank from an actress on the rise to a star who garners top dollar for movie roles.

Despite her success, Swank hasn't fallen victim to the trappings of sudden wealth. She still has many frugal habits engrained since childhood, including buying toothpaste and toilet paper in bulk. While making an appearance on the daytime talk show "Live! With Regis and Kelly" in 2010, the actress admitted that she still clips coupons. During that interview Swank said, "When you open up the paper and you see those coupons, it looks like dollar bills staring you in the face. . . . It’s how I grew up. Why not?"

Pickens has 55 years’ worth of professional achievements, including growing his first company, Mesa Petroleum, into a $2 billion business and an infamous 1985 "Time" magazine Cover. But these days, Pickens is almost as well known for his low-budget lifestyle as he is for his high-profile financial success. "People are always surprised that I don't have a closet full of suits," Pickens told Kiplinger. "I buy three suits every five or so years and only own ten total. That's all I need."

Pickens credits his grandmother with having taught him money lessons that still resonate: "She'd always tell me, 'Don't ever go any place with money in your pocket looking for something to buy.'" Even today, Pickens says that whenever he visits a store he first makes a list of what he needs, and he carries only the exact amount of money he plans to spend.

The First Lady is thrifty, too. She was spotted shopping at a Target store in the Washington, D.C., area last summer. What did she buy? It's reported that Mrs. Obama picked up dog food and toys for the first family's pet, Bo. In addition to finding ways to save on everyday household items, the First Lady is also known to cut costs when it comes to fashion. Despite having access to practically any high-end designer line she wants, Mrs. Obama sometimes chooses to wear clothing from discount stores, such as H and M. She appeared on the "Today" show last year wearing a $35 dress from the retailer.

How he struck it rich: Founded Berkshire Hathaway, the noted investment holding company

Frugal habit: Has lived in the same modest home for 54 years.

Buffett could easily afford to live in a mansion much bigger than his 6,000-square-foot, five-bedroom stucco house in Omaha, which he purchased for $31,500 back in 1958. Yet, the multi-billionaire prefers the simple life in small-town America.

In his annual letter to Berkshire Hathaway shareholders last year, Buffett discussed the housing recovery and said, "The third best investment I ever made was the purchase of my home." (The first two: wedding rings he bought for his first and second wives.) Buffett added, "For the $31,500 I paid for our house, my family and I gained 52 years of terrific memories, with more to come." Today, the average price of a five-bedroom home for sale in Omaha is $391,983, according to Trulia.com. That's more than 12 times the amount Buffett paid.

Frugal habit: Never pays retail prices for clothing or shoes and bargain hunts on eBay

Frankel doesn't take her newfound wealth (she sold Skinnygirl to Beam Global for a reported $100 million last year) for granted. Just a few years ago, the reality TV star and entrepreneur couldn't even pay her rent, as she revealed in a 2011 interview with ABC's "Nightline."

Her guilty pleasure is fashion, so when it comes to spending money on clothes, Frankel is adamant about not buying anything that isn’t on sale. To help avoid making impulse purchases, she shops mostly online and regularly at discount sites, such as eBay.com and net-a-porter.com.

How he struck it rich: Comes from a wealthy family and co-founded the private equity firm Bain Capital

Frugal habit: Buys golf clubs at Kmart

The GOP presidential candidate has quite a few surprising, budget-conscious spending habits -- several of which were revealed in a "New York Times" article last year. They include using JetBlue to snag cheap airfare, tackling home renovations himself and buying his golf equipment at Kmart. You heard it right. Romney, who is worth about a quarter-billion dollars, is always on the hunt for "blue light specials." A family friend was quoted in the same article saying that one of Romney's mantras is, "Just because you can afford something doesn't mean you should buy it."

Romney promises similar frugality within the federal government if he is elected president this fall. He proposes to cap government spending at 20% of gross domestic product. That would involve spending cuts of about $500 billion per year starting in 2016.